US FCC wants to reform big data to help poor telcos

The Republican head of the Federal Communications Commission wants to ease regulatory requirements in the $45 billion business data services market.

This is a win for AT&T, CenturyLink, Verizon but a problem for outfits like Sprint who think prices for business data are too high and backed a plan under President Barack Obama that would have cut prices.

Small businesses, schools, libraries and others rely on business data services, or special-access lines, to transmit large amounts of data quickly, for instance connecting banks to ATM machines or gasoline pump credit card readers. Wireless carriers rely on them for the backhaul of mobile traffic.

Writing in his bog FCC chairman Ajit Pai said the commission will vote April 20 to reform the rule that telecommunications experts say would deregulate the market in most of the country but would retain regulations in some places.

“Where this competition exists, we will relax unnecessary regulation, thereby creating greater incentives for the private sector to invest in next-generation networks. But where competition is still lacking, we’ll preserve regulations necessary to prevent anti-competitive price increases,” Pai said.

However consumer groups such as the Public Knowledge and Consumer Federation of America called Pai’s proposal a “bonanza” for big telecommunications companies that “will drain consumer pocketbooks of tens of billions of dollars per year”.

Under President Barack Obama, the then FCC Chairman Tom Wheeler proposed a reform plan for business data services that aimed to reduce prices paid.

Wheeler wanted to keep and lowering lower price caps using legacy data systems with a one-time 11 percent reduction in prices phased in over three years.

Sprint liked the idea said that thousands of large and small businesses across the country are paying far too much for broadband because of inadequate competition.

Sprint argued:  “A small handful of companies are overcharging the very investors and employers that are critical to our economic growth and are using anticompetitive tactics to ensure that these businesses never have access to competitive alternatives.”

However AT&T argued Wheeler’s plan was “little more than a wealth transfer to companies that have chosen not to invest in last mile fibre infrastructure”.